Relieving some stress on a country devastated by viral illness, the Internal Revenue Service (IRS) pushed back the traditional filing dates for income tax returns this year.
In January of this year, the US federal government moved slowly despite the looming possibility of a global pandemic. When the germ that causes COVID-19, SARS CoV-2 was identified on domestic shores, the disease had already made inroads into vulnerable populations. Vital public health measures, including physical distancing, have led to severe economic contraction, historic rates of unemployment, and the challenge of years of community and financial recovery after a vaccine has been developed—in a hoped-for 12 to 18 months.
According to the Washington Post, more than 60,000 stores have closed in mere weeks, and many will never open again. More than 10 million jobs have been lost in the same time, exceeding the total number of jobs lost in the Great Recession which spanned 2008 to 2010. Analysts predict several pandemic waves will be followed by a cascade of global crises that may last years.
Against this backdrop, moves made by the Federal Reserve and Congress are attempting to staunch losses flowing from this historic event. Even as the IRS works to deliver checks to taxpayers legislated to provide fast economic relief, the agency itself has moved to relieve taxpayers of the fast upcoming tax deadline of April 15.
Announced on March 21, the IRS is providing relief to taxpayers who would otherwise be filing on April 15. Taxes usually filed on April 15, 2020 by businesses, individuals, and trusts are now due on July 15, 2020. The extension is automatic and requires no qualifying application. The action of the IRS does not apply to state income tax deadlines. While most states have also provided an automatic extension to filers, it is important to ensure your state has waived the April 15 deadline.
FinCEN Form 114, the Report of Foreign Bank and Financial Accounts (FBAR), is not subject to the IRS extension. If you qualify to file an FBAR, by holding a specified amount of value in a foreign bank account, your filing is due on April 15, 2020. Despite the deadline, FBAR filers are also provided an automatic extension to October 15, 2020, without the need to apply.
Long predicted, the pandemic rampaging around the world still managed to catch humanity by surprise. Strong and sustained public health and financial actions will be required against this unseen foe. Take time now to observe social distancing, and ensure your federal tax filings are accurate and filed on or before Wednesday, July 15, 2020. Failure to file or filing false income tax returns still have the possibility of provoking an IRS audit of your interests.
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